Discuss the nature of events

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Question - You are auditing Green Corporation for the calendar year 20X2. Among other items related to the audit, Green is being sued for personal injury resulting from the malfunction of one of its products. Sue Ewe filed the lawsuit 8 years earlier in September 20W4. The officers of the company and its outside legal counsel estimate that the loss from the suit will be approximately $250,000. This amount has been accrued and properly disclosed in the footnotes of the financial statements. You have no reason to believe that the estimate is wrong. You completed your audit and dated your report March 2, 20X3. The financial statements were issued on March 14, 20X3. The trial was in progress at that date. On March 20, 20X3, you read in a national business periodical that the jury in the trial awarded Sue Ewe $1.5 million.

Required: Discuss the nature of these events and what responsibility the auditor has, if any, regarding the news of March 20.

Reference no: EM132432781

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